Bulls n Bears Daily Market Commentary : 06 October 2025

Tue Oct 7 09:39:19 CAT 2025

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Bulls n Bears Daily Market Commentary : 06  October 2025

ZSE commentary

ZSE Losses persist into the new week...

Losses on the bourse persisted into the new week as the AllShare Index
retreated 0.41% to 204.31pts while, the Top Ten Index fell 0.62% to
202.60pts. On the contrary, the Agriculture Index added 0.38% to 164.71pts
while, the Mid Cap Index edged up 0.41% to 229.39pts. Retailer OKZIM
headlined the losers of the day having lost 11.82% to close at $0.2100 as
FML followed on a 5.27% decline to settle at $2.6525. Mashonaland Holdings
pared off 2.06% to $1.4000 while, telecoms giant Econet trimmed 1.88% to
$4.3995. Tanganda Tea Company capped the top five losers of the day on a
negligible 0.04% loss to land at $0.8047. Partially mitigating today's
losses was sugar

refiner Star Africa that jumped 4.00% to end pegged at $0.0312 with Ariston
trailing on a 3.24% climb to finish at $0.0319. Seed Co Limited ticked up
3.23% to $3.0005 while, Turnall firmed up 0.22% to $0.0702. Beverages
manufacturer Delta completed the top five gainers' list on a 0.07% rise to
close at $14.0001.

Activity aggregates improved in the session, as volumes traded surged 28.37%
to 507,700 shares while, turnover jumped 20.30% to $1.70m. The volume
drivers of the day were Econet (28.56%), Dairibord (21.94%), Star Africa
(10.50%), Hippo Valley (8.51%) and Delta (7.84%). Econet, Delta and Hippo
Valley drove the value aggregate as they claimed 82.02% of the total. The
Revitus REIT notched up 0.82% to $1.0000 as 250 units were traded while, the
Tigere REIT charged 5.20% to $2.0000 as 400,634 units exchanged
hands.-fesecrities

 <mailto:info at bulls.co.zw> 

South Africa

South African rand weaker amid U.S shutdown uncertainty

A South African one rand coin sits on South African rand banknotes in this
arranged photograph in Pretoria, South Africa, on Wednesday, Aug. 14, 2019.
The rand ended a tumultuous week on a positive note, gaining against the
dollar for a second day and heading for its first weekly advance in four as
technical indicators suggested recent declines are overdone. Photographer:
Waldo Swiegers/Bloomberg via Getty Images

JOHANNESBURG, Oct 6 (Reuters) - The South African rand weakened on Monday as
global investors weighed how long the United States' government shutdown
will last and its potential impact.

At 1338 GMT the rand, which is often sensitive to shifts in global risk
sentiment, traded at 17.2500 against the dollar, a whisker away from its
Friday close of 17.2475.

The dollar last traded 0.1% stronger against a basket of currencies.

The U.S. government has shut down much of its operations, potentially
putting thousands of federal jobs at risk, after partisan divisions
prevented Congress and the White House from reaching a funding deal.

"While the U.S. government shutdown occurs every year to varying degrees at
this time, this year is expected to be significant given the substantial
political divide, which may see further risk aversion and U.S. dollar
strength in the short-term," said Annabel Bishop, chief economist at
Investec.

Domestically-focused investors will eye gold and foreign exchange reserves
data on Tuesday and manufacturing production figures on Thursday to gauge
the health of Africa's largest economy.

On the Johannesburg Stock Exchange, the Top-40 index was flat.

South Africa's benchmark 2035 government bond weakened, as the yield rose 6
basis points to 9.24%.

Nigeria

Naira rises to most competitive currency as reforms pay off

The naira's real effective exchange rate is now arguably the most
competitive in two decades, a development hailed as a major milestone for
Nigeria's economic policy.

Yemi Kale, group chief economist and managing director of Afreximbank, made
this observation in his keynote address titled "Reform and Resilience:
Strengthening Nigeria's Economic Foundations" at The Platform Nigeria event
in Lagos.

Kale explained that, in practical terms, Nigeria is no longer compelled to
sell scarce foreign exchange at subsidised rates. Exporters have also been
freed from the penalties of an overvalued currency, creating a healthier
environment for trade and investment.

The introduction of a more flexible exchange rate regime acts as a natural
shock absorber, allowing the currency to adjust gradually to fluctuations in
oil prices or global economic conditions, rather than triggering sudden
crises in the balance of payments.

Investors have responded positively to these reforms, as reflected in rising
foreign exchange reserves, which climbed from approximately $32.9 billion at
the end of 2023 to over $38.8 billion by mid-October 2024. By mid-2025,
verified foreign exchange backlogs had largely been cleared, and reserves
had surpassed $42 billion, a three-year high, signaling renewed confidence
in Nigeria's economic outlook.

For businesses, the new foreign exchange system has been transformative.
Companies no longer waste energy lobbying for scarce official foreign
exchange allocations and can instead focus on improving productivity and
competitiveness.

A more competitive naira has made Nigerian products more affordable on the
international market, stimulated non-oil exports, discouraged wasteful
imports, and encouraged local production.

Non-oil exporters and domestic companies reliant on imported inputs have
reported stronger earnings, while Nigeria's trade balance is reportedly
improving.

The naira's performance on the foreign exchange markets underscores these
positive trends. On Thursday, October 2, 2025, the currency converged at
N1,455 per dollar in both the official foreign exchange market and the
parallel (black) market, effectively closing the long-standing exchange rate
gap.

At the Nigerian Foreign Exchange Market (NFEM), the naira appreciated by 1.4
percent, with the dollar quoted at N1,455.23, up from N1,475.34 at the end
of September. Similarly, in the parallel market, the naira strengthened by
2.7 percent to close at N1,455, up from N1,495 just two days earlier.

Bala Moh'd Bello, a member of the Monetary Policy Committee (MPC),
attributed the naira's relative stability to tighter liquidity conditions,
growing investor confidence, and recent reforms in foreign exchange
management.

He noted that speculative activities in the foreign exchange market have
declined significantly, enhancing transparency and supporting market-based
price discovery. Bello added that this stability is expected to persist in
the medium term, supported by rising reserves, which stood at $40.11 billion
as of July 18, 2025, enough to cover about 9.5 months of imports.

Kale further emphasised that these reforms have strengthened macroeconomic
management by providing the Central Bank of Nigeria (CBN) with clearer
policy signals through a unified, more market-reflective, and rules-based
exchange rate system. This shift has enhanced the effectiveness and
credibility of monetary policy, laying firmer foundations for sustainable
growth.

"Reforms are not merely policy adjustments but deliberate, strategic
decisions aimed at stabilizing the present and securing a prosperous
future," Kale said. "They require patience, persistence, disciplined
execution, and the capacity to follow through."

However, these reforms have come with a painful short-term cost that was not
sufficiently cushioned. Inflation, which had already accelerated after the
removal of petrol subsidies, surged further following the naira float, as
imported goods, central to family consumption and critical inputs for
manufacturers became more expensive.

This experience is not unique to Nigeria. When Egypt floated its pound in
2016, inflation quickly exceeded 30 percent within months. However, Egypt
managed to restore investor confidence and stimulate growth by allowing the
currency to reach market-clearing levels, coupled with efficient and
targeted social safety nets that cushioned vulnerable households from the
initial cost shocks.

Unlike Nigeria, Egypt expanded food subsidy cards and rolled out cash
allowances to low-income families, providing a valuable lesson: stabilising
the currency market is fundamental to long-term economic health, even if it
causes short-term price turbulence.

Strengthening Nigeria's social protection systems will be critical to
ensuring the long-term benefits of reform are more widely and equitably
shared, he said.

Early evidence indicates that despite the initial hardships, Nigeria's
foreign exchange reforms are opening doors to a more diversified and
export-oriented economy.

The transparent foreign exchange regime has attracted a surge of foreign
portfolio inflows (FPIs), which help stabilise the naira in the short term.

Yet, foreign direct investment (FDI), essential for job creation and
industrial capacity will take longer to rebound as investors continue to
test the staying power of reforms, especially given Nigeria's history of
policy reversals.

Monetary policy adds another layer of complexity. The surge in portfolio
inflows has been supported by the CBN's decision to maintain policy rates
above 20 percent. While this approach supports short-term liquidity and
reserve accumulation, it also discourages long-term FDI.

Investors often prefer the almost guaranteed returns of government
securities offering close to 20 percent over the risks associated with
longer-term productive investments. This creates a trade-off between
short-term liquidity stability and long-term capital formation.

As inflation gradually eases, Kale said the CBN is expected to shift its
focus from attracting foreign portfolio inflows to encouraging FDI by
carefully lowering interest rates in a sequenced manner.

Timing will be crucial: cutting rates too soon could reignite inflationary
pressures, prolong reform-induced hardships, and undermine exchange rate
stability; waiting too long risks crowding out domestic investment and
critical FDI necessary for industrialization and job creation.

On the occasion of Nigeria's 65th independence anniversary, Kale's message
is clear: hope grounded in action, resilience, and strategic reforms can
unlock a prosperous future for the nation.

 <mailto:info at bulls.co.zw> 

Global Markets

Japanese yen, euro slide against dollar on fiscal concerns

(Reuters) - The Japanese yen and euro weakened against the dollar on Monday
on fiscal and political stability concerns after Japan's ruling Liberal
Democratic Party elected a new leader and France's new government quit.

The yen declined after Japan's ruling party picked conservative Sanae
Takaichi, an advocate of late premier Shinzo Abe's "Abenomics" strategy to
boost the economy with aggressive spending and easy monetary policy, as its
head on Saturday.

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start your day. Sign up here.

Her victory caused traders to reduce bets that the Bank of Japan will hike
interest rates this month.

"It was unexpected that it was going to be Takaichi," said Sarah Ying, head
of FX strategy, FICC Strategy at CIBC Capital Markets in Toronto.

"There's a little bit more focus on the back end of the curve now, just
given that Takaichi is generally seen as a follower of Abenomics. The market
expects a little bit more fiscal stimulus there."

The dollar at one point rose more than 2% to 150.47 yen, the highest since
August 1. It was last up 1.87% at 150.2, and if sustained, that would be its
biggest daily gain since May 12.

The Bank of Japan maintained on Monday its cautiously optimistic economic
outlook but warned of nagging uncertainty over the impact of U.S. tariffs on
corporate profits, suggesting its preference to wait for more data before
raising interest rates.

The euro reached 176.25 yen, the highest since the single currency was
introduced in 1999.

The euro slid against the dollar and the pound, however, after France's new
Prime Minister Sebastien Lecornu and his government resigned on Monday,
hours after announcing his cabinet line-up, making it the shortest-lived
administration in modern French history.

"It's not really too much of an existential crisis, it doesn't look great
domestically given especially what's going on with the budget," said Ying.
"The biggest risk is really if (President) Macron resigns, but it doesn't
seem to be a high-risk scenario."

The euro was last down 0.26% at $1.171. It earlier reached $1.1649, the
lowest since September 25 . It also dipped against the pound to its lowest
since September 18.

The European Central Bank may need to reduce borrowing costs slightly if the
risk of inflation going too low increases, but interest rates are
appropriate now, the ECB's top brass said on Monday.

The dollar index rose 0.4% to 98.11.

Traders are waiting for signs that the U.S. federal government will reopen,
with Congress so far unable to pass a bill to continue funding operations.

The shutdown is leaving a void of U.S. economic data, with last Friday's
closely watched monthly jobs report for September delayed along with other
key releases until the government reopens.

That has also resulted in lower market volatility.

"Financial market volatility has dropped significantly since the start of
the US government shutdown. Risks to US economic activity and the labour
market from furloughing, or even terminating employment of, federal workers
will not be apparent for a while," Barclays analysts led by Themistoklis
Fiotakis said in a report.

The Federal Reserve is widely expected to cut rates by 25 basis points at
its October 28-29 meeting, following data that shows a weakening labor
market.

Traders are also pricing in 83% odds of an additional cut in December,
according to the CME Group's FedWatch Tool, though this will likely depend
on data released before then.

In cryptocurrencies, bitcoin was last up 2.24% at $125,530, after hitting a
record high of $125,835.92.

 <mailto:info at bulls.co.zw> 

Commodities

Gold hits all-time high on safe-haven demand, Fed rate cut bets

(Reuters) - Gold hit a record high on Tuesday as there were no signs of a
reprieve from an impasse between the two houses of the U.S. Congress that
has led to a government shutdown, while near-certain bets of a U.S. rate cut
this month also lent support.

Spot gold was up 0.1% at $3,962.63 per ounce by 0626 GMT, after hitting an
all-time high of $3,977.19 earlier in the session. U.S. gold futures for
December delivery gained 0.2% to $3,985.30.

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"The (chances of) October and December cuts are still skewing above the 80%
mark, so that's actually supporting gold prices and also this government
shutdown as well, given there is still no resolution between the two sides
of the U.S. Congress," OANDA senior market analyst Kelvin Wong said.

Kansas City Federal Reserve Bank President Jeff Schmid signalled he is
disinclined to cut interest rates further, saying the Fed should stay
focused on the danger of too-high inflation as opposed to apparent job
market weakness.

Markets, however, are still pricing in additional 25 basis-point rate cuts
in both October and December, with probabilities of 93% and 82%,
respectively, according to the CME FedWatch tool., opens new tab

Non-yielding gold thrives in a low interest rate environment and during
economic uncertainties.

Gold has climbed 51% so far this year on strong central bank buying,
increased demand for gold-backed exchange-traded funds, a weaker dollar and
growing interest from retail investors seeking to hedge amid rising trade
and geopolitical tensions.

Goldman Sachs on Monday raised its December 2026 gold price forecast to
$4,900 per ounce from $4,300, citing strong Western exchange-traded fund
inflows and central bank buying.

China's central bank added gold to its reserves in September for the
eleventh straight month, data from the People's Bank of China showed.

Elsewhere, spot silver was steady at $48.49 per ounce, platinum fell 0.1% to
$1,624.11 and palladium rose 0.8% to $1,329.63.

INVESTORS DIARY 2025

Company

Event

Venue

Date & Time

Counters trading under cautionary

CBZH

GetBucks

EcoCash

Padenga

Econet

RTG

Fidelity

TSL

FMHL

ZBFH

Invest Wisely!

Bulls n Bears 

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opinions expressed and recommendations made are subject to change without
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